As of August 2020, attorney Samantha Kehl is no longer with her previous firm. The Kehl Law Firm, P.C., is currently taking meetings by appointment only.

Combining experience, compassion and reliable representation to give our clients the best possible experience during difficult times

  1. Home
  2.  » 
  3. Bankruptcy
  4.  » How Chapter 7 and Chapter 13 bankruptcy differ

How Chapter 7 and Chapter 13 bankruptcy differ

On Behalf of | May 28, 2021 | Bankruptcy

If you live in Texas and are struggling to keep up with your debts, you might want to consider bankruptcy. This can be a way for you to regain control of your financial life, get a fresh start and keep some of your assets. First, you will need to find out whether you should file for Chapter 7 or Chapter 13 bankruptcy.

How Chapter 7 and Chapter 13 differ

The major difference in the two types of bankruptcy is that Chapter 7 involves discharging most of your unsecured debt while Chapter 13 allows you to keep some types of property, such as your home, while you pay down existing debts. If you file for a Chapter 7 bankruptcy, nonexempt property may be sold to pay creditors. However, depending on what you own, some or all of what you own may be declared exempt.


There are restrictions on eligibility. For example, to file for Chapter 7, you generally need to have a relatively low disposable income compared to the median income in your state or have a debt that is disproportionate to what you could pay off based on your income. To file for Chapter 13, there is a limit on the total amount that you can owe in secured and unsecured debt.

Time until discharge

Chapter 7 usually only takes a few months from filing to discharge. Chapter 13 is a much longer process. You will make an agreement to pay a certain amount to the trustee monthly over a period of three to five years.

Certain types of debt, such as bankruptcy, taxes, student loans and alimony, usually cannot be discharged in bankruptcy. However, if you are able to get other debts discharged, it may be possible to catch up on these payments. Bankruptcy does have an effect on your credit rating, but falling into debt does as well, and after bankruptcy, you can start to rebuild your credit as you look ahead to a better financial future.